Innholdsfortegnelse for 25-Feb-2018 i Business Today

A pre-Budget panel discussion held by Business Today had most panellists express the view that this Budget would be dictated more by political compulsions than economic logic. With the General elections a year away, and several states scheduled to hold elections in the current calendar year, the consensus was that the government would focus a lot on its agricultural and rural constituents, try to do something for SMEs, and was unlikely to keep to the fiscal deficit target given the revenue collection problems because of the roll-out of the GST. There was talk about whether the government could do anything about employment generation, with most panellists feeling that at best the Budget could give a little incentive to companies that were creating new jobs. Opinion was divided as to whether…

MUKESH AMBANI has invested close to ₹2.35 lakh crore in building assets to make Reliance Jio’s digital business vertical on a par with refining or petrochemicals. The question, however, is whether Jio can deliver the sizeable cash flow that its sister businesses do? In the quarter ended December 2017, the refining business posted a profit before interest and tax of ₹6,165 crore and the petrochemical vertical ₹5,753 crore. Despite building up a subscriber base of 160 million and posting a whopping 38.2 per cent EBITDA margin, Jio showed a PBIT of merely ₹1,440 crore. Experts say even with double this subscriber figure, Jio won’t be able to generate a PBIT exceeding ₹3,000 crore. Jio posted its first quarterly net profit of ₹504 crore in the third quarter. Because of the…

It is finally happening. Even as marketers are steadily moving from conventional advertising platforms to digital platforms for advertising, within the digital space, too, there has been churn. Search, which was the predominant medium of advertising for brands across the board, is losing its sheen; and social media has outshined it, albeit marginally. According to a report by digital marketing and communications firm Dentsu Aegis Network, social media currently takes the lion’s share – 28 per cent – of all digital ad spends in India, amounting to ₹2,309 crore. Search advertising commands 26 per cent share (₹2,128 crore) and display follows with 21 per cent share (₹1,714 crore). The size of digital advertising in India is ₹8,202 crore. SOCIAL MEDIA ADVERTISING IN INDIA IS EXPECTED TO GROW AT A CAGR…

₹48,318 cr The amount by which the government has exceeded its gross fiscal deficit target for 2017/18 as per the revised estimates 18.3% The shortfall in non-tax revenues in 2017/18 revised estimates (RE) from Budget estimates (BE) 37% Increase in loans to self-help women groups over the previous year 187 Total projects sanctioned under the Namami Gange programme 1.26 cr Number of accounts opened under the Sukanya Samriddhi Account Scheme until November 2017 ₹1.5 LAKH CRORE Increase in the volume of institutional credit to agriculture between 2014/15 and 2017/18 7.8% The rise in defence allocation over 2017/18 Budget estimates TAX BUOYANCY BRINGS CHEER Tax-GDP ratio (%) has been rising ₹22,17,750cr Total expenditure according to 2017/18 RE, ₹71,015 crore more than the BE for 2017/18 8cr The new target of free…

DURING his election campaign in 2014, Prime Minister Narendra Modi had promised to create 10 million new jobs if elected to power. In practice, unemployment has risen marginally under NDA rule, from 4.9 per cent in 2013/14 to five per cent in 2015/16. An estimate by the Confederation of Indian Industry (CII) says the country added just 3.65 million jobs per year between 2011/12 and 2015/16. Against this, a study by the Indian Institute of Management (Bangalore) professor, Pulok Ghosh – who is also an external advisor to State Bank of India – showed the country will add 7 million people to formal job market in the current financial year, though this has been disputed by a number of experts, including Mahesh Vyas of CMIE. And this is only a…

IT WAS ASSUMED all along that Essar group director Prashant Ruia’s frequent trips to Moscow would conclude with the sale of Essar’s oil refinery business to Russian oil giant Rosneft. But there is more to it than meets the eye. The Moscow visits seem unlikely to end soon since the Ruias are now working towards forming a consortium with Russian bank VTB and Hong Kong-based SSG Capital Management to regain control of the debt-laden Essar Steel, put up for sale under the bankruptcy law. Essar Steel has over ₹43,000 crore of debt on its books. As things stand, VTB and SSG are expected to contribute the lion's share of the funds required for the bid while the Ruias would most likely be minority shareholders in the consortium, say media reports.…

August ’17: Suggested Nandan Nilekani’s comeback to Infosys as non-executive chairman to put the company on a strong footing STATUS: It was just a coincidence that the announcement of Nilekani’s appointment came later July ’17: Recommended voting against ITC’s decision to pay a monthly remuneration to Y.C. Deveshwar, the non-executive chairman STATUS: The resolution gets passed; ITC files a ₹1,000-crore defamation case against IiAS June ’17: Advised shareholders to vote against Gautam Singhania's reappointment as director on Raymond’s board. Raised governance issues STATUS: Resolution passed by shareholders Feb ’17: Raised concern over Vikram Limaye’s appointment as a BCCI administrator by the Supreme Court. Questioned his ability to focus on his primary role – that of MD & CEO of IDFC Ltd STATUS: Limaye’s appointment to the NSE was announced; his…

Going by the influx of smart devices, we may never have to lift a finger again. Smart speakers from Amazon, Google and Apple are just the tip of the iceberg as far as smart assistants are concerned. The possibilities are endless when there is a connected ecosystem where devices can communicate amongst each other and respond to your commands – from brewing your morning coffee to turning on the shower for your post work-out bath. Flamboyantly speaking, you can have your own Jarvis à la Iron Man. From controlling home appliances from within apps (the Internet of Things), we can now directly talk to them. With the increasing adoption of smart speakers, device manufacturers are embedding support for popular voice assistants, simplifying almost everything we do. Voice-controlled lighting and thermostats…

Unless you’re feeling particularly cold, crossing your arms when in conversation with people is not a good idea. It’s an old established body language rule but one that’s forgotten all too easily in business settings, where it matters most. Anyone sitting with their legs prominently extended towards the door of a room, for example, probably wants to exit as soon as politely possible. Anyone straddling a chair instead of sitting the usual way is likely to be feeling very dominant. Anyone with arms crossed is feeling defensive and wants to guard against something – opinion, criticism, dislike, disagreement or a number of other feelings. Crossing your arms when standing with a group of people can subtly change the atmosphere almost immediately – notice how the tone/topic changes, how a few…

COURTESY: ROBB REPORT INDIA Fashion BLING IT ON Three weeks, fifteen hundred Swarovski crystals, all patiently put up by hand. Sculptor Dan Jacob’s Air Jordan 1 Pinnacle ‘Golds’ are only made on order and cost $6,500. But lovers of bling will be happy to note that he has made a wearable pair of shoes. So if you’re feeling like tennis superstar Serena Williams, who wore a pair of Nike Cortez that had been hand embellished with Swarovski crystals by Michelle from Meraki Mishell, go right ahead and order. TV Fashionable Story The Assassination of Gianni Versace features in the second season of Ryan Murphy’s American Crime Story on FX. What gives the show the real edge is the costumes. Allison Leach and Lou Eyrich had nearly five weeks to assemble…

STAY CONNECTED WITH US ON www.facebook.com/BusinessToday@BT_India PERSPECTIVES Is Low Recovery Rate in Early Insolvency Cases a Cause of Worry? Many cases relating to non-performing assets of major companies are a kind of litmus test for the IBC. And the way they are resolved would reveal the effectiveness of the insolvency law. businesstoday.in/npa-insolvency.law Can Tatas Buyout Mistrys from Tata Sons? Mistry's SP Group, which is the single largest shareholder in Tata Sons, seeks board representation proportionate to its holdings. businesstoday.in/tatasons-mistry NEWS Selling IPL Ad Inventory Will Not be Easy for Star India Star India needs to earn ₹54 crore per match to breakeven its IPL spends and this revenue will certainly be a far-cry in the first season businesstoday.in/ad.inventory-starindia I-T Rule on Treating Discounts as Capital Expense Will Hit Small e-tailers…

WITH RBI HOLDING rates due to inflation concerns, promoters have been turning to share pledging to raise money. Data compiled for 2,400 companies shows that promoters of 630 companies pledged shares in Q3FY18. Of these, promoters of 71 companies pledged more than 95 per cent of their holdings. Though an effective source of finance, promoter pledging can lead to volatility in stock pricing when markets are down.Markets seem to be favouring companies whose promoters have reduced their pledging. Ninety companies whose promoter pledging (as a percentage of their total holdings) halved between Q3FY17 and Q3FY18 delivered an average return of 63.5 per cent (between Dec 30, 2016 and Jan 30, 2018). Average returns were more significant in companies whose promoters eliminated pledging in Q3FY18 compared to Q3FY17. The group includes…

THE TARIFF WAR IN the telecom sector refuses to subside. Jio upped the game recently for older telcos by launching a ₹49 plan for JioPhone, the telco’s low-cost feature phone. The plan offers unlimited voice calling and 28 gigabytes of data over 28 days. In retaliation, Airtel and Vodafone are offering 1.4 GBs of data per day – and unlimited calls – for ₹199 and ₹198 per month, respectively. Just when everyone was expecting Jio to mellow down after an aggressive start, it has done exactly the opposite. Jio’s noholds-barred fierceness has started to unsettle more than just telcos. In a recent report, Kotak Institutional Equities noted that “even as the company’s [Jio’s] actions…are suggestive of a drive to domination and willingness to be as aggressive… our challenge is to…

27 27 A NEW ORDER WHAT: New Growth Models in a Changing Global Landscape WHEN: February 27, Jakarta, Indonesia WHAT TO LOOK FOR: The IMF conference will debate the future trends in the global economy that need to be considered such as geopolitical developments and technological change. The list of speakers include Christine Lagarde, Managing Director, IMF and Agus Martowardojo, Governor,Bank Indonesia. 5-7 LIGHTS, CAMERA, ACTION! WHAT: FRAMES 2018 WHEN: March 5-7, Mumbai WHAT TO LOOK FOR: FRAMES is a three day global convention covering the entire gamut of media and entertainment like films, broadcast (TV and radio), print media and digital entertainment. It attracts not only industry stakeholders from across the globe but also policy makers from India and abroad. 7 MASTERCLASS FOR CFOs WHAT: 11th edition of CII…

THREE YEARS AGO, the government launched a subsidised crop insurance policy to help farmers. The farmers now pay only a small 1.5-2 per cent of the sum assured for crops whereas the balance, the bulk of the premium, is shared equally by the Centre and state governments. The scheme has managed to provide an insurance cover of close to ₹2 lakh crore with premium outgo of ₹22,000 crore plus from the exchequer. Experts often criticise the crop insurance scheme, accusing private players of reaping rich dividends while the risk is getting transferred to re-insurers, mostly the state owned GIC. The Union Budget 2018/19 has a new proposal on similar lines. It has proposed a subsidised health protection plan for 10 crore poor families with a cover of Rs 5 lakh…

“Our procurement exercise has thrown up a price which is the lowest in the world for this category of vehicles”Saurabh Kumar, Managing Director, Energy Efficiency Services Ltd. An electric car charging station in Central Delhi set up a couple of months ago at Niti Aayog’s office has not been used for weeks. That hardly anybody at the think tank uses an electric car is an obvious but not the only reason. Set up to showcase technology enhancements in car charging around the world, this fast charger is incompatible with the only three electric car models that are available in India. With Niti Aayog at the forefront of making policies for mass adoption of electric cars, the irony of this defunct car charging point is not lost on anybody. The fast…

Humans experience self doubt more often than they like to admit. It’s thought of as negative and rarely encouraged as it means indecisiveness. Doubt serves an important function though: it makes you question and review an action or decision you are about to take and, hopefully, reduces the chances of a blunder. If human beings are to work in tandem with intelligent machines, doubt has to be built into them as well. Not only do humans need to be assured that a machine is reviewing possibilities and consequences, but also that it can communicate the degree of uncertainty. “If a self-driving car doesn’t know its level of uncertainty, it can make a fatal error that can be catastrophic,” says Google researcher Dustin Tran, in the MIT Technology Review. That’s why…

FIIL’s wireless over-the-ear headphones, launched in India recently, have the formidable task of competing against the bigwigs Bose, Sennheiser and Sony. Irrespective of how it handles that challenge, the headphones make a good first impression. These bulky looking headphones, weighing 270 gm, are made from aluminium alloy. They are comfortable to wear for longer durations – thanks to the leather-covered foam ear pads. The ear cups have a 40-mm driver. The headphones sport a simple and neat design; there’s only one physical button on the right ear cup that powers on the headphones. A double-press turns on/ off active noise cancellation, a medium press (for two seconds) activates Siri/ Google Assistant, and a single press can pause/ play music and even answer or reject calls when paired over Bluetooth. The…

DO YOU PLAY THE PIANO? Click photos? Do yoga? Taking up a hobby takes your mind off work, breaks the monotony of life and boosts your health and happiness, experts say. “A hobby, if pursued sincerely, can reduce stress and lower the risk of stress-induced diabetes. It can also improve the quality of life,” says Dr V. Mohan, co-founder of Dr Mohan’s Diabetes Specialities Centre in Delhi. Top leaders of India Inc. concur. Venu Srinivasan, Chairman and MD of TVS Motor Company, believes meditating for at least 30 minutes a day helps “de-junk the mind”. According to G.V. Prasad, co-chairman and CEO of Dr Reddy’s, “Senior executives think about work 24x7, which creates a lot of unnecessary stress. A diversion (in the form of a hobby) takes you away from…

By Tamal Bandyopadhyay Penguin Random House India Pages: 348 Price: ₹599 BANDYOPADHYAY moved from Business Standard to Mint in 2008, where he has contributed over 600 columns in the past decade; this is a selection of 88 – all but two from Mint. Most of the book is about the Indian banking system, but Bandyopadhyay also covers the Lehman and demonetisation crises. He can be a trenchant critic, but he is affable enough to make good friends amongst the powerful; so he often gets inside information of the goings-on. The book also covers 15 important people. A glass or two of Laphroaig cannot have hurt the flow of communication with the chairman of State Bank. Thanks to the friends he makes, Bandyopadhyay picks up extraordinary information. I was fascinated by…

The central government is sending mixed signals to the private healthcare industry. On one hand, it wants private hospitals and other stakeholders to play a major role in fulfilling the ambitious plans it has outlined in the National Health Policy (NHP) 2017. On the other, it is increasingly taking a tough stance against the prevalent pricing systems, since it can’t ignore the affordability factor. In fact, NHP rightly observes that the regulatory environment around pricing requires a balance between patients' concern for affordability and industry’s concern for adequate returns on investment for growth and sustainability. Several of the current interventions like capping of prices of certain medical devices and hinting at expanding the list to others, however, are more an irritant than a fruitful intervention to make healthcare affordable to…

CHINESE ONLINE major Alibaba group is on an investment spree in the Indian e-commerce market. Alibaba first invested $300 million in online grocery store Big Basket and, subsequently, its affiliate Ant Financial invested $200 million in food discovery and delivery app Zomato. A short while back, Alibaba had acquired a stake in Xpressbees, a logistics start-up; it already had a presence in Paytm Mall. Alibaba now joins SoftBank and Tencent in being the top three investors in Indian start-ups. 1.5MN PEOPLE MIGHT BE RENDERED JOBLESS IF INDIA MAKES A SUDDEN SHIFT TOWARDS EVS, ACCORDING TO AUTOMOTIVE COMPONENT MANUFACTURERS ASSOCIATION OF INDIA…

APPLE’S RECORD QUARTERLY EARNINGS Apple has clocked its highest ever quarterly revenue in Q1 2018 (the fiscal quarter ended in December 2017), reaching $88.3 billion, up 13 per cent YoY. The Cupertino company has generated $20 billion in profit. However, it has seen slightly weak demand and sold 77.3 million iPhones in this quarter, exactly one million less than what it had shipped in the same period a year ago. BIOTECH DEALS GET BIG In a second biotech blockbuster deal within a week, French drugmaker Sanofi is acquiring Belgium’s Ablynx for $4.8 billion. Earlier, Sanofi said it would buy US-based Bioverativ for $11.6 billion. With these deals, the total value of pharma sector M&A has reached nearly $40 billion in January 2018, the highest ever in more than a decade.…

* CONDITIONS APPLY HEALTH CARE 10 CRORE POOR FAMILIES TO GET INSURANCE UP TO ₹5,00,000 RURAL INFRA ₹14. 34 LAKH CRORE AMOUNT TO BE SPENT ON INFRASTRUCTURE TO CONNECT FARMERS AND MARKETS ALLOCATION OF ₹56, 619 CRORE FOR SCHEDULED CASTES AND ₹39,135 CRORE FOR SCHEDULED TRIBES The Union Finance Minister actually presents two different Budgets every year. The first is the Budget his speech is all about – it focuses on the policy or political messages he (or more accurately, the Prime Minister) wants to convey to his audience, both within the Parliament and among the citizens of the country. The second is the one which is contained in the minutiae and the fine print of the Budget documents that are tabled. The first is easy to react to. The…

THIS IS PERHAPS the first budget which brings the farmer and rural India to the centre of economic policy and fiscal allocations. It lays the foundation for India to achieve a high rate of economic growth, because all along what the country missed was increasing farmer’s income at a sustained rate. Unless the rural sector incomes and productivity levels improve, we will not be able to make use of the potential demand that exists for consumers and consumer durable products. Farmers’ incomes go up and down depending on shortages or plenty. Once we achieve a sustained rate of rural income growth and take steps to eliminate the dualism between Bharat and India, only then can India progress without plunging into crisis now and then. The difference that this budget makes…

On January 30, two days before the Narendra Modi government announced a rural and agriculture centric Union Budget, the NDA government's fourth Economic Survey for 2017/18 was tabled in Parliament. The document provides an analytical overview of the economy during the year. Prepared by the finance ministry’s chief economic advisor (CEA), Arvind Subramanian, and his team, the survey estimated that India’s GDP would grow 6.75 per cent in 2017/18 and 7-7.5 per cent in 2018/19. It identified private investment and exports as the two engines that can propel the country’s economic growth. The views expressed in Economic Surveys are not sacrosanct. Union Budgets often take a different path than the one taken by the surveys. Finance Minister Arun Jaitley also seems to have done that while coming out with a…

When French yoghurt-maker Danone (post its acrimonious break-up with Britannia) started its second innings in India in 2009, it was considered the most innovative dairy player. With products such as smoothies, flavoured yoghurt (all packaged in UHT packs for increased shelf life), as well as Bengal’s mishti doi, the yoghurt-maker nudged incumbents like Amul and Mother Dairy to strengthen their innovation pipeline. In an interview with Business Today in 2016, Danone’s then head of dairy business in India, Jochen Ebert, had emphasised the company’s commitment to the Indian market. Ebert said the biggest opportunity lay in the fact that per capita consumption of yoghurt was just 30-40 litres vis-a-vis 300-400 litres in most mature markets. To capitalise on that opportunity, the company had set up its own milk collection infrastructure…

“NEVER DOUBT THAT A SMALL GROUP OF THOUGHTFUL CITIZENS CAN CHANGE THE WORLD; INDEED, IT’S THE ONLY THOUGHT THAT EVER HAS”—By American cultural anthropologist Margaret Med AMIT TANDON MD & Co-founder, Institutional Investor Advisory Services AGE: 57 Years Economics graduate from St. Stephen’s College and MBA from Delhi University Holds 7.4 per cent stake in IiAS An ICICI veteran, honed his skills at the group for over 17 years Was MD & CEO, Fitch Ratings, where he worked between 2001 and 2011 Recent top assignment as member of the Uday Kotak Committee on Corporate Governance The season has just got over for us,” says an exhausted Amit Tandon, looking at the deserted cubicles in a 4,000 sq. ft. ground floor Central Mumbai office. Tandon is the Co-founder and MD of…

IT IS IMPRESSIVE enough that you can control something with eye movement inside of a virtual reality (VR) headset; now you can actually brain-control things as well. A company called Neurable based in Boston, US, has demonstrated mind control using a VR game they call ‘Awakening’. First, we have a headband that has electrodes to tap brain activity that connects to an HTC Vive VR headset. Then there’s software to match the two. A calibration phase is needed in which the wearer focusses on objects and the accompanying brain signal is recorded. In the game, when the player thinks of the objects already seen, the software is able to pick up what he wants to do – for example, pick up a toy and move it. The process is still…

If all is peaceful at work, there is reason for concern. Humans are designed for problem solving and if that is taken away, boredom and depression can set in quickly and devastatingly. Boredom at work has such a stigma attached to it that only few would even recognise that they’re bored. Some companies don’t wait for this inevitability and move their employees around every two years or so. Or at least when they fare exceedingly well in the appraisals consistently. Supervisors protest at all the training apparently about to go to waste and the trouble of starting all over again with someone else, but the fact is that the person will begin to drift away in any case, either physically or by becoming disengaged from work. Challenges are tough, but…

Research has revealed how hobbies can help improve the quality of life and health. Meditation, for instance, is associated with what neuroscience refers to as reduced activity in the default mode network (DMN) of the brain. DMN is a brain network involving a number of brain regions and any change in their activities through meditation could help you calm down and focus better, preventing your mind from wandering or thinking too much about yourself. Several studies on cyberspace highlight the benefits of playing the piano that result in better brain efficiencies. It has been found that pianists have a more balanced central sulcus (a groove or a furrow on the surface of the brain) instead of a deeper one on one side, as is the case with most people. Eventually,…